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    Monday, August 17, 2009

    Reuters - Struggling Sony Ericsson taps Nordberg as new head

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    Struggling Sony Ericsson taps Nordberg as new head

    Monday, Aug 17, 2009 10:50AM UTC

    By Tarmo Virki, European technology correspondent

    HELSINKI (Reuters) - Sony Ericsson on Monday entrusted the head of Ericsson's U.S. technology division with the task of leading the struggling cellphone maker back to profit and reversing a sharp decline in market share.

    The 50-50 venture said it named Bert Nordberg as chief executive in place of Dick Komiyama, who retires at the end of this year.

    Sony Ericsson has reported steep losses in past quarters and seen its market share slip to below 5 percent, sparking market speculation of a possible breakup.

    "I would go for increased market share and restoring profitability," Nordberg told Reuters when asked where he hopes to see the company in 1-2 years' time. He said he would pursue ongoing restructuring and step up efforts to develop "smash-hit" products.

    Nordberg, 53, currently Executive Vice President at Ericsson and head of the firm's Silicon Valley business, said he was extremely confident in support from both parent companies, while turning to profit "can't be too far away."

    Of the top five cellphone vendors, Sony Ericsson saw the sharpest drop in sales from the first quarter.

    The firm has missed trends like full keyboards, Internet browsing and navigation, and research firm Gartner said last week its market share fell to just 4.7 percent globally.

    'BIG DECISIONS TO MAKE'

    "Nordberg has some big decisions to make from day one," said Ben Wood, head of research at CCS Insight.

    "Sony Ericsson needs to streamline its mobile software strategy and further reduce its dependence on mid-tier feature phones while working to restore profitability in the toughest economic climate the mobile phone industry has ever seen."

    Sony Ericsson is known for its phones focusing on music and imaging, but it has so far lacked a strong offering of smartphones.

    Nordberg said he would look for a strategic revamp of the firm's product portfolio. "In this industry you need smash-hit products," he said.

    The firm also said Sony CEO Howard Stringer would become new board chairman on Oct 15, replacing Ericsson head Carl-Henric Svanberg, who will become chairman of BP in January.

    Nordberg has been with Ericsson since 1996, prior to which he worked with companies including Data General Corp. and Digital Equipment Corp.

    In July Sony Ericsson posted a pretax loss of 283 million euros ($400 million), and said the rest of the year would be difficult, with the overall market to shrink at least 10 percent.

    Shares in Ericsson were 1.3 percent lower at 66.30 crowns by 1033 GMT, outperforming a DJ Stoxx European technology index down 2 percent.

    (Reporting by Tarmo Virki and Brett Young, editing by Will Waterman, John Stonestreet)

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